Alaska Air Group (NYSE:ALK) stands out in the airline industry as a U.S. legacy carrier with the cost structure of a low-cost airline. The airline’s robust balance sheet with low leverage positions it well for strategic acquisitions like Hawaiian Holdings (NASDAQ:HA), which is why I’m bullish on ALK. These factors combined suggest that the stock could surge over 47%, according to Wall Street consensus.
Despite recent underperformance, largely attributed to operational issues beyond its control, I anticipate a strong Q2 for Alaska Air, with the Hawaiian Airlines acquisition serving as a short-term catalyst.
Factors Leading to ALK’s Underperformance
Alaska Air stock has underperformed most U.S. legacy airlines over the last 12 months, with a devaluation of more than 32%. Despite this, its performance this year has been relatively stable, declining by 2.5%.
In my opinion, the main reasons behind this underperformance could be…
